The re-sale value of a leasehold property in Shildon depends on how many years the lease has left to run. If it is close to or less than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of purchasing. It is ideal to start the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be finalised prior to the eighty year threshold. Current legislation entitles Shildon qualifying lessees to an additional term of ninety years on top of the remaining term, at a peppercorn rent (no ground rent). The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Shildon with in excess of one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Shildon can be a difficult process. We recommend you get guidance from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Shildon lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following unsuccessful discussions with the freeholder of her two bedroom flat in Shildon, Bethan started the lease extension process as the eighty year deadline was quickly advancing. The transaction was finalised in June 2005. The landlord’s fees were kept to an absolute minimum.
Last year we were approach by Ms O Garcia , who owned a basement flat in Shildon in June 1997. The question was if we could approximate the compensation to the landlord could be for a ninety year lease extension. Comparable homes in Shildon with a long lease were in the region of £295,000. The mid-range amount of ground rent was £45 collected every twelve months. The lease came to a finish in 2099. Having 74 years remaining we estimated the premium to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of fees.
Mr and Mrs. L Kelly owned a newly refurbished flat in Shildon in February 2007. The question was if we could estimate the price would be for a ninety year lease extension. Similar residencies in Shildon with an extended lease were worth £243,000. The average ground rent payable was £65 billed per annum. The lease terminated on 18 October 2088. Taking into account 63 years outstanding we estimated the premium to the freeholder for the lease extension to be between £20,000 and £23,000 not including costs.